A closer look at financial development and income distribution推荐.pdf

Journal of Banking Finance 35 (2011) 1698–1713 Contents lists available at ScienceDirect Journal of Banking Finance journal homepage: www.else /locate/jbf A closer look at financial development and income distribution Céline Gimet a, Thomas Lagoarde-Segot b,⇑ a University of Lyon, F-69007, CNRS-GATE, UMR no. 5824, France b Euromed Management, School of Management, Marseille DEFI, University of Aix-Marseille, EA no. 4265, France a r t i c l e i n f o a b s t r a c t Article history: This paper analyzes the under-investigated relationship uniting financial development and income distri- Available online 20 November 2010 bution. We use a novel approach taking into account for the first time the specific channels linking banks, capital markets and income inequality, the time-varying nature of the relationship, and reciprocal causal- JEL classification: ity. We construct a set of annual indicators of banking and capital market size, robustness, efficiency and C33 international integration. We then estimate the determinants of income distribution using a panel Bayes- D63 ian structural vector autoregressive (SVAR) model, for a set of 49 countries over the 1994–2002 period. G15 We uncover a significant causality running from financial sector development to income distribution. In O16 addition, the banking sector seems to exert a stronger impact